Ross Norman has an enviable record in predicting the gold price. He has also built up a reputation as a commentator on gold in newspapers and TV channels.

But a distasteful commentary he wrote last week on the controversy surrounding the London gold fix made disparaging remarks about journalists, in the course of which he wittingly, or otherwise, belittled the very media that brought him fame.

In a rather unbecoming burst, he lambasted journalists for not doing enough research before asking questions. “Surely never before have so many lines been written by journalists on a subject that they palpably know so little about and have made little attempt to understand... as the London gold fix,” he wrote.

The provocation was a live interview on BBC where the interviewer asked Norman questions on London’s centuries-old process for fixing gold prices, which has been tainted by a grotesque rigging scandal. In the prevailing price fixing system, four banks — Barclays and HSBC along with Societe General of France and Scotiabank of Canada — agree on a price and declare it as the fix.

The scandal broke out when an ex-trader of Barclays admitted attempts to manipulate gold prices, for which the bank was clamped with a fine of $45 million. The scandal also saw Deutsche Bank pull out of the arrangement.


Disclosure and the drama

The disclosure and the drama that followed have prompted widespread fears that the current gold fixing practice is open to abuse and, therefore, in desperate need for reforms. This was supposedly the focus of the BBC interview.

Having been a gold trader with a company that once headed the London gold fixing group, Norman may have had his reasons to defend the system and run down those who demand change.

But one important reason he cites against change is that such attempts would reduce London’s pre-eminence in gold trade. “London will have lost one of its most prized institutions which is a massive contributor to the UK economy and the envy of centres such as Dubai, Shanghai, Mumbai and Singapore,” he laments.

“British experts in the sector are global leaders in many fields from trade finance, structured deals, vaulting, refining, assaying and we stand to lose primacy in the global bullion market simply because a bunch of tired and rather lazy hacks cannot be bothered to work it out.”

Norman may be partly true about the British expertise, but no one can overlook the fact that London is neither a major producer nor a major consumer. Mere ‘expertise’ is no longer a deal clincher in today’s world, in which geographical boundaries have submerged to create a new universe of empowerment, knowledge and expertise.

Gold trade is no ‘white man’s burden’.

In fact, Dubai, which Norman has included among those who are envious of London, has a much more sustainable claim to become the centre for global gold trade. As much as 40 per cent of all gold flows in the world happen through Dubai and the city is easily the most important hub for the trade.

Dubai has the infrastructure and the systems to set benchmarks, and even its own good delivery standards. It is now time for it to start asserting its role and demand recognition for its contributions to the trade.

With such major changes happening in every sphere of business, the current age belongs to performers and not consultants, who have had their share of fame but are now ready to be consigned to the dustbins of history. If managing global gold trade is anybody’s business, it is most obviously that of the producers, consumers or those who make trade happen.

Any other role is secondary.

— The writer is a journalist based in Dubai